Oil futures finished mixed on Thursday, with October West Texas Intermediate crude settling lower while October RBOB gasoline rose to a near-term high. WTI declined as signs suggested Middle East supply disruptions may be easing, while gasoline climbed after expectations increased that refinery runs could shift away from gasoline toward diesel amid record-high diesel prices.
Key takeaways
- Price move: October WTI crude closed down -0.52 (about -0.51%), while October RBOB gasoline rose +0.0223 (about +0.64%).
- Catalyst: Crude fell on indications that Middle East disruptions could lessen; gasoline rose after Goldman Sachs flagged tightening supplies as refiners prioritize diesel output.
- Key implication: The market continues to price oil and product balances differently, with Middle East geopolitics and product demand/supply dynamics diverging.
- Context to watch: Saudi pipeline and Hormuz/Red Sea logistics remain a key swing factor for crude sentiment, while refinery product switching is driving gasoline strength.
What drove the move
Crude oil prices fell on Thursday amid signs that supply disruptions in the Middle East may be starting to ease, a development that investors have increasingly weighed against earlier fears of tighter global availability.
In the background, traders have been monitoring the regional logistics that have helped determine whether crude flows can route around the Strait of Hormuz. Saudi Arabia has previously pointed to a disruption involving the East-West pipeline—an artery that moves crude from the Persian Gulf toward the Red Sea. The pipeline was shut down late last Friday following drone strikes, and the closure prompted Saudi Arabia to adjust export patterns, including delaying some deliveries to European customers. Over the subsequent sessions, sentiment around whether the disruptions would unwind has influenced WTI’s direction.
Crude also has been supported at points by broader Middle East risks. Yemen’s Houthi rebels have targeted energy facilities in Saudi Arabia and expanded their position along key maritime corridors near the Bab-al-Mandeb Strait and the Red Sea. At the same time, Saudi Arabia reported that August crude production fell to 6.238 million bpd, the lowest since 1990, according to statements cited in the article.
For refined products, gasoline moved higher even as crude weakened. The push came after Goldman Sachs said gasoline supplies are set to tighten as refiners switch output from gasoline to diesel, responding to historically strong diesel pricing. Data points highlighted in the report also supported the idea that product balances are currently tighter in gasoline than in crude.
Market reaction and key oil-demand signals
Beyond the immediate headline catalysts, the broader demand outlook and storage trends have continued to inform crude trading. The International Energy Agency warned that high prices and restricted supply will lead to the biggest decline in global oil demand this year since the Covid-19 pandemic, while also noting that the global oil surplus is now expected to return later than previously projected.
On the U.S. supply side, the weekly picture showed modest inventory and production dynamics. The EIA report cited in the article indicated that U.S. crude inventories as of September 11 were 0.8% above the seasonal 5-year average, while gasoline inventories were 4.8% below the seasonal 5-year average and distillate inventories were 12.8% below. U.S. crude production in the week ending September 11 fell slightly to 13.944 million bpd, just below the record of 13.947 million bpd from the prior week.
Liquidity and physical market tightness also remained in focus. Vortexa reported that crude stored on tankers stationary for at least seven days fell 23% week-over-week to 76.39 million bbl in the week ended September 11, the lowest level in a year, according to the article. Lower on-water storage can be consistent with tighter short-term availability, even when futures prices are volatile.
Meanwhile, the drilling backdrop was not flashing major changes. Baker Hughes reported that active U.S. oil rigs rose by 1 to 450 for the week ended September 11, remaining modestly below the 455 level seen in the week of August 14, as cited.
Bigger picture: geopolitics, OPEC, and refining dynamics
The crude story remains closely tied to regional geopolitical risk and export routing. The article cited reports that a portion of Saudi exports may have been affected by the East-West pipeline closure, with the pipeline acting as a way to move crude away from the Persian Gulf toward the Red Sea for loading on tankers. Any improvement in pipeline availability or alternative routing would likely reduce the urgency premium in WTI futures.
At the same time, analysts are factoring in supply attrition risks from multiple sources. The article cited Vitol Group’s assessment that global markets have tightened due to losses of crude export volumes from the Middle East and additional disruptions tied to Russia amid Ukraine-driven attacks. It also referenced estimates that Saudi crude exports dropped to about 3 million bpd in August, the lowest in nine years, according to data compiled by Bloomberg, Kpler and Vortexa.
Russia-related supply concerns also stayed relevant. The report cited EA Analytics data showing Russian crude-processing rates averaged 3.51 million bpd in July, the lowest in 24 years, and referenced secondary estimates attributed to OPEC showing Russian crude production of 8.89 million bpd in July, the lowest in six years. Reuters was also mentioned for reporting that Russia’s gasoline production fell to about 80,000 tons a day in August, around 70% of domestic demand, contributing to shortages.
On the supply policy front, the article noted that OPEC delegates approved a final production increase for September of 188,000 bpd, while stating that output would be held steady for the rest of the year after the hike. Still, the report suggested the ability to fully deliver planned increases could be challenged by ongoing U.S.-Iran-related military activity in the region. It also cited that OPEC’s August crude production fell by 900,000 bpd to 19.91 million bpd.
Gasoline’s relative strength underscores that the market is not trading crude and products as a single instrument. With refiners potentially shifting output away from gasoline toward diesel, gasoline inventories can tighten even if crude prices soften. That divergence is particularly relevant for investors tracking crack spreads and product-led commodity risk rather than only headline crude levels.
What to watch next: Traders are likely to focus on any further updates on Middle East export routing and pipeline restoration, as well as developments around refinery economics that could influence gasoline-versus-diesel switching. In the near term, attention will also turn to additional weekly inventory data from the EIA and upcoming supply/demand signals that could clarify whether the crude downside pressure persists while product balances remain tight.
